Domestic indices trade flat in late morning deals

Indian equity markets were trading flat in late morning deals, as traders remained cautious amid lingering concerns about the recent turmoil in the banking sector. Meanwhile, broader indices on the BSE were trading lower in the range of 0.35-0.50%. Muted cues from other Asian markets weighted on the domestic sentiments. Concerns that interest rate hikes by several central banks could slow down economic growth were also weighing on the markets. Shares of asset management companies (AMCs) witnessed weakness after Finance Bill amendment proposal. In a move to remove the tax advantage enjoyed by debt mutual funds over bank fixed deposits, the government has proposed to tax gains arising from debt MFs at the investor's slab rate, irrespective of the investment period. HDFC AMC, UTI AMC, Aditya Birla Sun Life AMC and Nippon AMC were trading lower.

On the sectoral front, traders were seen pilling up position in IT, TECK, Bankex and Auto, while selling was witnessed in Metal, Energy, Realty, Oil & Gas and Consumer Durables. On the global front, Asian markets were trading mostly in red despite the broadly positive cues from US markets overnight. Back home, in the stock specific development, Campus Activewear slipped as a private report said that private equity firm TPG had plans to sell 7.62 per cent stake worth Rs 800 crore in Campus Activewear via a block deal at Rs 345 per share.

The BSE Sensex is currently trading at 57903.49, down by 21.79 points or 0.04% after trading in a range of 57677.05 and 58066.40. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.39%, while Small cap index down by 0.49%.

The top gaining sectoral indices on the BSE were IT up by 0.78%, TECK up by 0.69%, Bankex up by 0.11% and Auto up by 0.03%, while Metal down by 1.40%, Energy down by 0.66%, Realty down by 0.62%, Oil & Gas down by 0.56% and Consumer Durables down by 0.40% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.19%, TCS up by 1.11%, Power Grid up by 0.59%, Wipro up by 0.40% and Kotak Mahindra Bank up by 0.37%. On the flip side, Bajaj Finserv down by 2.35%, Bajaj Finance down by 2.16%, Tata Steel down by 1.76%, Reliance Industries down by 0.92% and Larsen & Toubro down by 0.82% were the top losers.

Meanwhile, the rating agency ICRA in its latest report has said that the overall infrastructure credit (including banks and non-banks) registered an annualised growth of 8% in 9M FY2023 aided by a sharp pickup in Q3 FY2023, bucking the trend of the previous 18 months. It noted that non-banking financial companies - infrastructure finance companies (NBFC-IFCs) grew in line with the system and maintained their market share at around 54% as on December 31, 2022.

According to the report, the increased demand has coincided with the period during which NBFC-IFCs witnessed receding asset quality pressure, led by a few stressed asset resolutions/recoveries, sizeable write-offs, and curtailed incremental slippages. The stage 3% eased to 3.4% as on March 31, 2022, from the peak of 6.8% as on March 31, 2018. The reported gross stage 3% is expected to moderate further by 10-30 basis points (bps) in FY2024, supported by limited slippages and growth in the book.

The report stated that NBFC-IFCs are expected to benefit from the credit demand generated by the Central Government’s ambitious targets under the National Infrastructure Pipeline (NIP) and ICRA expects them to grow by 10-12% in FY2024. This, coupled with limited incremental slippages, is expected to lead to these NBFC-IFCs reporting multi-year low asset quality indicators (lowest in last six years) in FY2023 and FY2024. ICRA has revised the industry outlook for NBFC-IFCs to Positive from Stable, reflecting its expectation that the enhanced performance witnessed in FY2023 will continue in FY2024 as well, given the improvement in the solvency profile, calibrated loan book growth in the near term and better asset quality and earnings profile.

The CNX Nifty is currently trading at 17046.15, down by 30.75 points or 0.18% after trading in a range of 16994.90 and 17109.45. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Infosys up by 1.19%, Apollo Hospital up by 1.15%, TCS up by 1.10%, Cipla up by 0.75% and Dr. Reddy's Lab up by 0.50%. On the flip side, Adani Enterprises down by 3.27%, Hindalco down by 2.51%, Bajaj Finserv down by 2.34%, Bajaj Finance down by 2.16% and Tata Steel down by 1.86% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 88.4 points or 0.44% to 19,961.24, Shanghai Composite weakened 16.51 points or 0.5% to 3,270.14, KOSPI dropped 15.12 points or 0.62% to 2,409.36, Nikkei 225 slipped 52.39 points or 0.19% to 27,367.22. However, Taiwan Weighted added 50.75 points or 0.32% to 15,914.70, Jakarta Composite gained 69.23 points or 1.02% to 6,760.84 and Straits Times rose 0.49 points or 0.02% to 3,219.49.